Friday 29 June 2012

Get A Grip!



Oh dear Margaret Hodge (Chairman of PAC) continues to be "underwhelmed" by HMRC's less than stellar performance.

She is quoted by the Telegraph, in response to an National Audit Office (NAO) report on HMRC's accounts published yesterday:
"'Sadly it is no surprise that the NAO has found substantial problems with the HMRC's accounts. This year has seen a litany of tax errors and scandals come to light with mistakes made at the most senior level from the permanent secretary for tax downwards. 

The sheer scale of waste and mismanagement at HMRC never ceases to shock me. Without even mentioning the tax gap, in 2011/12 the department wrote off a staggering £5.2 billion of tax owed, overpaid nearly £2.5 billion in tax credits due to fraud and error and underpaid around £290 million. 

In some areas the department is moving in the right direction and has made progress to implement improvement plans. But the department is still plagued by IT problems; limiting, for example, its ability to link together the debts owed by taxpayers across different tax streams. 

With its long history of large scale IT failures, the department needs to get a grip before it introduces its new real-time PAYE information systems and begins the high-risk move from tax credits to the universal credit.'' 
The warning about the oncoming car crash that is RTI was echoed by Amyas Morse (the Comptroller and Auditor General), who said:
''Our high-level recommendations in today's report are that, first, the department should get a better understanding of the costs and benefits of its interventions - such as debt campaigns and initiatives to drive down levels of error and fraud in tax credits.

Secondly, it should prioritise and target its activities on the basis of a better understanding of risks, such as risk-profiling of taxpayers. 

Finally, before implementing significant structural changes, the department needs to be clear about what its future operating model will be: it needs to understand how its business will change following the introduction of real-time information and universal credit. 

There are broad lessons here which reinforce the messages in our recent value-for-money work on tax administration. The department should seek to apply those lessons across the full range of its activities.''
However, HMRC are quite upbeat about things:
"Today's report recognises the new system has bedded in well, and the legacy cases we inherited from the old clerical system are well on the way to being cleared.

We have a long way to go before we are delivering the standards of service to which we aspire, but today's report reflects the real strides forward the department has made, and sets solid foundations for the future.'' 
So that's alright then, nothing to see here move along please!

The key issue, in my humble view, is that both PAC and NAO are "politely" flagging their very real fear that RTI is going to be a clusterfuck. Loyal readers know full well that this site has repeatedly warned of this oncoming clusterfuck that is RTI. Seemingly others are now waking up to the dangers, sadly rather late in the day.
  
Anyhoo, here is the summary of the report, the full version can be read here C&AG report: HM Revenue and Customs 2011-12 accounts:
"The report details progress by the Department in stabilising the PAYE service since the serious problems that emerged when it introduced the new National Insurance and PAYE service (NPS) in 2009. The report also covers HMRC’s performance in managing tax debt; and its progress in tackling fraud and error and in managing debt in respect of tax credits.

In 2011-12, the Department received total revenue of £474.2 billion, an increase of £4.5 billion (0.96 per cent) more than in 2010-11. Tax revenue has continued to recover from the effects of the recession in 2008-09 and 2009-10. VAT revenue has increased by £9.3 billion, largely because of the VAT rate increase and increases in revenue from the oil, gas and business services sectors. Revenue from corporation tax has decreased through turbulence in the financial sector, offset by increased revenue from offshore companies because of higher oil and gas prices.

The Department is part way through its plan to stabilise the administration of PAYE. It has met its target to process 6.7 million end-of-year reconciliations relating to the 2008-09 and 2009-10 tax years. In addition, it is on track to reconcile the 2010-11 and 2011-12 tax years by March 2013; and, by December 2012, to clear outstanding reconciliations predating the introduction of NPS relating to 2003-04 to 2007-08.

Today’s report points out, however, that stabilising PAYE has come at a cost, in terms of the amounts of tax the Department has decided to forgo to keep workloads manageable. In 2011-12, it remitted an additional £12.7 million relating to claims from taxpayers, bringing the total of those claims to £53.7 million.

The NAO recommends that, as a step towards forecasting its overall work load and the operational resources required, the Department complete its review of its PAYE operating model, taking account of the findings from the pilot for testing its new ‘real time information’ (RTI) system.

The value of tax debt at 31 March 2012 under active management stood at £13.3 billion, compared with £15 billion in the previous year. The Department has made progress in implementing its debt strategy through tailoring its approach based on the characteristics of the debt. The Department’s records show a large increase over the last two years in the amount of tax which the Department has decided not to pursue, especially for income tax which was £756 million in 2011-12. This is in part owing to PAYE stabilisation work but also as a result of improvements in the recording of remissions.

The NAO recommends that the Department identify the full cost and evaluate the cost-effectiveness of each of its debt collection activities. It should also accelerate its work to undertake full risk profiling and customer segmentation of its debt balance, as recommended by the Public Accounts Committee in 2004 and 2008.

In 2010-11 (the latest year for which figures are available), the Department overpaid between £2.08 billion and £2.46 billion to claimants as a result of error and fraud and underpaid between £0.17 billion and £0.29 billion to claimants because of error. The Department has not met its target to reduce the level of tax credits error and fraud to no more than 5 per cent of entitlements.

The Department met its target to reduce tax credit debt to £4 billion at 31 March 2012 (down from £4.7 billion a year earlier), but only after writing off old debts of £1.7 billion during 2011-12. It estimates that £2.3 billion of the £4 billion is unlikely to be recovered. The Department’s campaign approach, aimed at collecting tax credits debts more promptly, has had limited success."

Tax does have to be taxing.






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Thursday 28 June 2012

Homer Gets Roughed Up At PAC




Poor old Lin Homer (CEO of HMRC) got a very rough ride at yesterday's Public Accounts Committee. Homer was forced onto the back foot by aggressive questioning from the committee, and had to repeatedly deny that HMRC enter into negotiations with large companies over how much tax they pay (although they do negotiate wrt other tax issues eg IHT "You should consider negotiating a settlement where the issues are not clear cut and the taxpayers cannot be persuaded that your point of view is the correct one.").

Well, sorry to say it, but unless things have changed since when I was a young internal auditor in the early 90's that simply isn't true (or at least she may be mistaken).

The standard practice between HMRC (the Inland Revenue as it was then) and companies was for IR to present a tax figure (detailing how they derived it) and for the company to present theirs. Where there were major discrepancies the two parties would keep "surprises" (eg write offs, hidden losses, hidden profits etc etc) in reserve to use during the discussions as to how much the tax bill would finally be. A final figure (midway) would usually be decided whereby both IR and the company felt that they had gone as far as they could without incurring costs of litigation etc.

That to me is a "negotiation", and there is nothing wrong with that if both parties act with honesty, integrity and commonsense.

Anyhoo, apparently, these "negotiations" do not occur now (according to Homer).

Hmmm!

Leaving that aside, Margaret Hodge (chairman of PAC) accused HMRC of letting large corporations off paying large sums of money and (as per the Huffington Post) said that there were "many question marks" hanging over the settlements reached in cases such as those involving Vodafone and Goldman Sachs.

Referring to the Vodafone case, Hodge said:
"It seems to me that you haven't pursued them properly and you have actually let them off a lot of tax."
Re the giant vampire squid, Goldman Sachs, she said that it had been "let off tens of millions".

Homer said that she accepted criticisms relating to governance arrangements and was aiming to increase the number of commissioners with tax law qualifications from one to three or more, as well as to recruit as many as 1,000 tax-qualified graduates.

Jim Harra, director-general of business tax at HMRC claimed that HMRC were investigating the tax affairs of “just over 4,000” companies

Homer said:
"We settle for the amount we think the Revenue is due. We do not settle for a lesser amount than we believe we could reasonably expect if we litigated."
To which Hodge retorted that Homer's position was "incredible".
"It is the committee's view that there are so many question marks over whether the settlements are in the public interest and properly defend the taxpayer's interests and are fair and equal under the law."
Homer refused to handover documents detailing the precise tax arrangements of large companies which have come into the spotlight, insisting that she was not allowed to do so unless the papers entered the public domain as part of a court case.

Whilst Hodge threatened to refer HMRC lawyer Anthony Inglese to the Attorney General over claims he made under oath in an earlier parliamentary hearing that lawyers were involved "throughout" the Vodafone case.
"I think you should take this away and investigate further whether or not somebody who accounts to you did mislead Parliament and we will take away what we will do, with possible reference to the Attorney General, as to whether or not a particular individual accountable to you did mislead Parliament."
All in all a pretty lousy day for HMRC.

In my humble opinion, if "negotiations" are still conducted in the same manner as I described from the early 90's then Homer should have stated that forcibly and without shame.

A commonsense cost effective approach to gathering tax is surely what everyone wants, and should be aiming for, is it not?

As ever, comments and opinions from all are very welcome. I would be particularly interested to hear if the "negotiations" that I described are still carried out in the same way.

Here is the hearing for you to watch:






Tax does have to be taxing.








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Wednesday 27 June 2012

HMRC's 38 year Backlog

According to media reports over the weekend, HMRC are embroiled (there's a fine word!) in something like 20,000 tribunal cases that will take around 38 years to clear.

So why are we all moaning because it takes HMRC a "wee while" to answer their phones?

No wonder they are tied up!

The backlog, according to the media, is due to “rock-bottom” morale combined with a lack of resources. Given the many comments and stories on this site wrt morale and resources, that seems to be a plausible explanation in part.

With the retirement of many experienced tax professional from HMRC, the department is clealry becoming under resourced wrt experience.

Ian Hyde, a partner at the law firm Pinsent Masons, is quoted by the Telegraph:
HMRC is beset by poor morale, high staff turnover, budget cuts, and a lack of quality when it comes to training and knowledge.”
Unfortunately HMRC, instead of focussing on evasion and fraud, is stuck in the mindset that avoidance is also illegal (referring to it in the same light as evasion and fraud, even using the ward "war"):
We do believe that we are winning the war against avoidance.
The £917 million made available to us as part of our 2010 spending settlement for tackling avoidance, evasion and fraud, is being used against the avoidance ‘industry’.

The Government has closed down many film schemes that were used to avoid tax. Many of the schemes still being marketed just don’t work.
It is foolish and emotive for HMRC to use the word "war"; as previous "wars", eg those against drugs and terrorism, end up becoming expensive failures that exacerbate the problems that they were meant to solve.

Tax does have to be taxing.





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TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Tuesday 26 June 2012

Tax Avoidance Poll



Tax does have to be taxing.




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Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

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Monday 25 June 2012

HMRC Strike



Cameron and the anti avoidance zealots will be most distressed to learn that approximately 55,000 HMRC staff are going on strike over job cuts and "creeping privatisation". Sky Tyne and Wear are of the view that the strike has been inspired by Jimmy Carr (a rather daft idea, given that the vote was taken sometime before Carrgate).

Anyhoo, the Public and Commercial Services (PCS) union members are protesting about plans to cut 10,000 HMRC posts by 2014/2015.

Ironically, according to the union, the strike is also being used as a warning against cutting resources futher; as PCS is of the view that the cuts increase the loss of tax via illegal tax evasion and via legal tax avoidance schemes.

The former point has validity, the second doesn't as tax avoidance is (by definiton) legal and legislation as to what is legal/illegal is the domain of the politicians not HMRC or PCS.

HMRC are quoted by the BBC:
"We are seeking dialogue with the PCS to address their concerns and will work to minimise any disruption to our customers.

In our 2010 spending review the government made £917m available to us to tackle avoidance, evasion and fraud. This is being used to increase our tax take from compliance work by £7bn a year in 2014/15 which we are on target to do."
The strike means that phone calls in affected offices may well go unanswered ('cough'), it will be followed by other forms of action such as a ban on overtime.

Tax does have to be taxing.



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TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

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Sunday 24 June 2012

It's All Balls!

Courtesy of the Telegraph, an amusing battle between HMRC and Subway over the need to heat a Meatball Marinara “sub”:
"The Subway sandwich is set to be the subject of a High Court battle that could reignite the VAT pasty row that caused the Government such pain earlier this year. 

The case revolves around the heated Meatball Marinara “sub”, one of its most popular. 
If the tax authorities lose the case, it would be another blow to the Treasury and its attempt to close the VAT loopholes on food. 
The Subway sandwich is heated up before it is handed to customers, and in the eyes of the Treasury it is therefore “above ambient temperature” and liable for the full level of VAT at 20pc. 
A test case was bought by a franchisee based in Huddersfield in 2010, who claimed that all of its toasted subs were heated in order to comply with food safety legislation. 
 It argued that the heating process was needed to stop the Marinara sauce from being “thick and glutinous”. The franchisee’s legal team employed a professor of surface metrology (the measurement of heat and surface changes) to measure the temperature of the sandwiches and the “ambient” temperature of the shop. 

In 2010 a judge ruled in the tax authorities’ favour and Subway has been forced to carry on charging VAT on its toasted sandwiches. 

However, a group of more than 100 Subway franchisees is appealing the decision and the case will be heard at the Upper Tribunal for tax, in the High Court next month. 

Their solicitor, Dipak Jotangia, a partner at Diss Solicitors, said that the Government’s decision not to press ahead with the pasty tax gave them confidence they would win the appeal."

Tax does have to be taxing.






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What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Friday 22 June 2012

Poll Results

Poll results
see previous polls

This poll has been sponsored by venntax, an association of independent tax consultancies providing expert advice directly to clients or more often through their accountants and other advisors.

Find out more about venntax, give them a call on 0800 0 842 837, or fill in the form below and they'll be in touch.




Tax does have to be taxing.



Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Thursday 21 June 2012

K2 The Savage Mountain - Cameron Castigates Carr's Morality



It would appear that David Cameron did not read my article yesterday, about Jimmy Carr's K2 tax avoidance scheme, in which I warned David Gauke that:
"Avoidance is a perfectly normal human thing to try to do, the politicians are not in a position to lecture the rest of us on "morality".
Cue David Cameron who, wading in without thinking for one moment about the consequences, boldly proclaimed to the world that Jimmy Carr's tax arrangement "isn't morally right". 




Rather amusingly it does seem that Ed Miliband has in fact read my article, for in the Telegraph he is quoted as saying:
"I'm not in favour of tax avoidance obviously, but I don't think it is for politicians to lecture people about morality."
He is quite right (bloody hell, I'm agreeing with Miliband!), a politician lecturing us on morality is as natural as a cat walking on its hind legs.

I would remind Cameron that, whilst none of his income (from his job, his trust funds, his inheritance etc etc) may not be reduced by "morally repugnant" perfectly legal tax arrangements, many of his fellow Tory MPs and indeed many of his party's donors may well use such schemes themselves (eg Sir Philip Green). 

I would also remind the Prime Minister that raising a hue and cry over tax avoidance (eg in the form of the investigation of civil servants on off payroll schemes) is all very well, but what happens when your proud boasts to end these schemes come to nowt?

I refer to two issues:

1 The fact that HMRC pay some of its own staff off payroll, yet will not be investigating them:
"Given that some of HMRC's staff are also "off payroll":
"HM Revenue and Customs (HMRC) announced that nine staff has been paid ‘off-payroll’ and that since the discovery by Exaro News three of these positions have ended. 350 contracts that have paid civil servants ‘off-payroll’ have also ended; 35 civil servants have continued working under new terms and conditions." 
I wonder if HMRC will also be investigating them?

I suspect not, as HMRC have the get out clause of "high risk" and also will not be pursuing those whose arrangements have been sanctioned by HMRC.


In other words HMRC has placed itself outside of its own investigation."
2 The HMRC investigation into the hundreds of council officials who are working off payroll has been blocked.

Exaro News reports that despite pledges from ministers to crack down on councils paying senior staff through personal-service companies, they have been powerless to halt such tax-beneficial contracts. Instead, they have merely issued fresh Whitehall guidance on pay arrangements.

Eric Pickles, communities and local government secretary, wrote to the Local Government Association (LGA), which represents councils in England and Wales, about officials’ contracts.

However, no one has asked the LGA to find out which council officials had tax-beneficial contracts.

Does this matter?

Yes, because it means that without such a review HMRC will not be able to carry out the similar exercise that it is doing for the 2,400 civil servants on off payroll schemes (excluding its own staff of course!).

Cameron has got himself well and truly stuck on top of the Savage Mountain (aka K2), not only will his "promises" to deal with these schemes come to nowt, but he has effectively declared open season on every Tory MP, every Tory candidate and every Tory donor. The media and other interested parties will pore over their finances with a fine tooth-comb, and one by one every single tax avoidance scheme (that the PM finds "immoral") will be made public (I guarantee there are hundreds of Tory MPs and Tory donors etc using these such schemes).

Cameron has lost touch with reality, in a desperate attempt to grab a soundbite and pander to the anti avoidance lobby.

To repeat what I said yesterday:
"Avoidance is a perfectly normal human thing to try to do, the politicians are not in a position to lecture the rest of us on "morality."
A politician lecturing us on morality is as natural as a cat walking on its hind legs. 

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

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Tax Investigation Competition - Win £10

Tax Investigation Competition - Win £10


One of my very loyal readers, Nick Morgan, has asked me to post this message about his book "Everything you wanted to know about a tax investigation but were too afraid (or skint) to ask" and a wee competition that he is running:
"Do you know where the goalposts are? 

Anybody in the tax investigation game knows that HMRC is constantly moving the goal posts and not just moving them, painting them different colours and pushing them closer together too! 

Any advice on tax investigation has to be checked, double checked and continually updated. I’ve just updated the eBook “"Everything you wanted to know about a tax investigation…." and I think it's very good and factually accurate. 

As part of the fact-checking process I’m offering £10 – cash – to the first reader who can spot a factual error in the book. 
The book normally costs £10 but for the next 48 hours it’s going to be available free, you can see it and get a copy at this address 

Click on this link to see the eBook

If you can find an error contact me using the form at http://www.tax-hell.co.uk/contact/

Good luck. 

Nick 

PS spelling mistakes don't count for the £10 but if you spot one do let me know.

www.tax-hell.co.uk

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Wednesday 20 June 2012

Gauke Gets Trapped On K2 (The Savage Mountain)



I see that our old chum Treasury Minister David Gauke has vented his spleen on the Jimmy Carr K2 tax avoidance issue.

His comments come after The Times sent an undercover reporter to a tax seminar, which outlined a scheme known as K2. The Times says comedian Jimmy Carr is one of those who uses the scheme, although his lawyers stress he has done nothing wrong.

Avoidance and, for the moment, the K2 scheme is perfectly legal.

However, that did not stop Gauke from commenting (based on what he read in the media, rather on what he actually has discussed with HMRC or other tax/legal experts) saying that he would describe the K2 scheme as fitting into the chancellor's description of "morally repugnant".

He is quoted by the BBC:
"Where there are arrangements that are artificial, that are contrived, that are not undertaken for any genuine commercial reason, but are purely designed to reduce tax liability, then that is something that we want to address.

Graham Aaronson has rightly highlighted his proposals for a general anti-abuse rule, which we are taking forward and, actually, the government is doing an awful lot in this area.

If you look at international comparisons actually HMRC performs pretty well in terms of yield and the size of the tax gap, but there's more to do.

My understanding is that HMRC were already investigating this particular scheme and, although I don't want to be drawn too much into the specifics, a lot of what has been said about how this scheme operates is the sort of thing that actually doesn't work any more.

Very often you get these promoters who will be, of course, selling their product... it doesn't always work quite as effectively as they like to make out to their potential clients. So I know HMRC are on the case on this particular matter."
I would remind Gauke, and his fellow cabinet ministers, of what I wrote in April, on another site, about the dangers of politicians digging themselves into holes wrt tax avoidance:
"David Cameron dug himself into another hole today, by discussing his dislike of "aggressive tax avoidance" (which of course is perfectly legal).

Tax Journal
reports that John Humphys noted on this morning’s Today programme that the Chancellor said in the Budget that he regarded tax evasion and ‘aggressive tax avoidance’ as ‘morally repugnant’.

He was trying to clarify, he said, what the government meant by ‘aggressive tax avoidance’ and offered Cameron a case study:


 "A very successful businessman (you’ll know who I’m talking about) creates a structure that transfers most of the ownership of [his] company to his wife through offshore companies based in the Channel Islands. She lives in Monaco, he takes a huge dividend – it’s paid to her, it’s estimated that this reduces his tax bill by hundreds of millions of pounds.’

Humphrys asked: ‘Is that “aggressive tax avoidance” and therefore morally repugnant?’

Cameron declined several times to answer the question, saying he was not going to discuss an individual’s tax affairs. Humphrys said Cameron knew that the individual was Sir Philip Green, whom Cameron recruited to advise the government.

Cameron said he did not know Green’s tax affairs and offered his own definition.

‘There are things that people do that reduce their tax liability, for instance they put money into a pension scheme.’

‘Rather than Monaco,’ Humphrys said.

‘Absolutely,’ Cameron said. ‘I think putting money into a pension scheme is a sensible thing to encourage people to do and that doesn’t count as aggressive tax avoidance … I’m very clear about the difference between putting money into pension schemes or Enterprise Investment Schemes to help start-up businesses, and there is that form of tax avoidance where people are almost specifically setting up a company in order to avoid tax rather than actually wanting to invest in start-ups and the rest of it.’

The government had taken a lot of steps to try to reduce ‘this sort of activity’, Cameron added. ‘For instance we have put £900m extra into HMRC to enable them to go after aggressive tax avoidance.’

Aggressive tax avoidance was wrong, he said. ‘It’s right that the government is going after this activity. Everyone should pay their taxes properly.’

Generally speaking, he told Humphrys, it was ‘sensible’ for a Prime Minister not to have dealings with people engaged in aggressive tax avoidance."
So there you have it folks, "aggressive tax avoidance" is whatever the government chooses to define as "aggressive tax avoidance"; the fact that it is perfectly legal seems to escape them.

Georgie Porgie and Cameron need to be reminded of the wise words of Lord Templeman in 1992:
"There is no morality in a tax and no illegality or immorality in a tax avoidance scheme.""
I leave the final word to Christie Malry who tweeted:
"If tax was voluntary and paid by the consumer, none of you would opt to pay it. So, seriously, shut the hell up about tax avoidance."
Avoidance is a perfectly normal human thing to try to do, the politicians are not in a position to lecture the rest of us on "morality".

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Tuesday 19 June 2012

Securing Compliance With Real Time Information – Late Filing and Late Payment Penalties



A few days ago HMRC issued a consultation document entitled "Securing Compliance With Real Time Information – Late Filing and Late Payment Penalties". The deadline for submissions being 6 September 2012.

HMRC being known for its "customer focused" attitude is keen to point out that, despite the concept of RTI being "quick and simple", it is gung ho to impose new penalties for late submissions. Hence the consultation document is about penalties (rather then the smooth implementation of RTI):
"Supplying information to HMRC under RTI is designed to be quick and simple, as it will be integrated into employers’ payroll processes. 

HMRC wants to maximise compliance with RTI and this document seeks views on how we can achieve that. 

Late filing penalties will be a fallback where information is not supplied on time, and this document seeks views on how these penalties should be structured. It sets out two possible models that build on existing penalty models. 

Late payment penalties will also apply although under RTI the payment obligation for employers is not changing. 

Some refinements to the existing late payment penalty model are set out in this document and views are also sought on these."
The "good" news being that:
"The new late filing and late payment penalties for RTI will be issued automatically rather than manually." (para 2.12)
No possibility of error there then, given how well HMRC has done so far with wrt issuing automatic penalty notices!

Shhh don't mention the 12,000 erroneous penalty notices sent out in April.

As loyal readers know, RTI features on this site with the depressing regularity and inevitability of the return of an unloved season, eg in April I wrote:
"Today being the 100th anniversary of the Titanic sinking, it seems appropriate to highlight this well crafted comment made by a loyal reader yesterday about RTI (which topically makes an analogy of RTI hitting an iceberg):
"There are over 4 million employers in the UK. The RTI Pilot is running with just a handful. I gather even by October 2012 the number will have only been increased to a couple of thousand. This is still only about 0.05% of the total. The plans seem to suggest that over 99% of employers are going to be brought into the scheme from April-October 2013. This is a challenging timetable to put it mildly.

More worryingly the number of employee record being processed each year is going to balloon from about 25 million annual returns to in excess of 500 million weekly or monthly returns. This is going to put a great deal of pressure on HMRC already creaking IT systems. In particular the need for data to flow through the system on a relatively short cycle (ie weekly or monthly rather than annually) means that any failures in the application will lead to back logs of returns building up quite quickly. Once that happens the system may struggle ever to recover.

On the face of it RTI has potential disaster written all over it. However, this probably wont happen until after the pilot using a few carefully selected employers has been declared a success. Expect everyone involved to jump ship at that stage before it hits the iceberg and sinks with all hands."
Call me a cynic, but I do not believe that RTI has a hope in hell of coming in on schedule, on budget or on specification."
I have no reason, based on information available, to change my views on RTI ending up as being a clusterfuck of Titanic proportions. However, as ever, I welcome the views and opinions of others.

Tax does have to be taxing.

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What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

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Monday 18 June 2012

Communicating With HMRC



My thanks to a loyal reader who dropped me a wee note the other day, about the problems that he had been having trying to obtain a letter of fiscal residency from HMRC:
"I've been trying to get a Letter of Fiscal Residency for the last couple of months. 

No-one answers the phone, a registered letter has not been answered in three weeks...the usual great service. So, I found a new online service that lets one apply for the fiscal residency confirmation online. 

Great, I thought. 

Filled in the form, pressed send, and got the following auto reply: 

'Thank you for your application for a certificate of residence. HM Revenue & Customs (HMRC) aim to deal with the majority of applications within 15 working days and you should receive a reply within this timescale...'

Eight days later and I noticed I'd received a reply. 

Great! 

Not great:
'Please note that the e-mail address you have used is not for direct customer enquiries. Your e-mail has not been read by HMRC staff and will not be responded to. 

Please visit our website at http://www.hmrc.gov.uk for ways to contact us. 

This is an automated response. 

Please do not reply to this email as your email will be deleted.'"
Can anyone cast some light on the rather bizarre response from HMRC?

My loyal reader and I assume that the form (found here) is being misdirected to the wrong internal email account in HMRC (or that whoever receives it simply does not read it).

For those of you who may also be seeking a letter of fiscal residency, my loyal reader eventually found a backdoor via which to ask for one. He attached a note to his online tax return, and received a reply today from the 'eTeam' confirming that his request had been received and the certificate had been issued on the 11th.

Tax does have to be taxing.

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What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Gong




Congratulations to Dr James Ferguson, permanent secretary for tax (central policy) at HMRC, who was awarded a CBE in the Queen's birthday honours.

Anyone know why?

Tax does have to be taxing.

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What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Friday 15 June 2012

HMRC To Investigate Some Off Payroll Deals



Exaro News reports that HMRC will launch an investigation into the widespread practice of civil servants working ‘off payroll’.

The investigation into the "off payroll" arrangements will commence within a few months, and will focus on the “highest-risk cases” of suspected tax underpayment by senior public officials.

An HMRC spokesman told Exaro:
Where there are question marks, we shall look at those cases and take action.” 
He said that HMRC was already starting to “risk profile” individuals identified by the Treasury review.
We shall be looking through the list.

If they stand out as ‘high risk’, we shall be taking action as soon as possible.”
Given that some of HMRC's staff are also "off payroll":
"HM Revenue and Customs (HMRC) announced that nine staff has been paid ‘off-payroll’ and that since the discovery by Exaro News three of these positions have ended. 350 contracts that have paid civil servants ‘off-payroll’ have also ended; 35 civil servants have continued working under new terms and conditions." 

I wonder if HMRC will also be investigating them?

I suspect not, as HMRC have the get out clause of "high risk" and also will not be pursuing those whose arrangements have been sanctioned by HMRC.

In other words HMRC has placed itself outside of its own investigation.


Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Thursday 14 June 2012

NAO Publishes Settling Large Tax Disputes



In May I wrote that I had been advised by the National Audit Office (NAO) that their delayed report into "HMRC's Sweetheart Deals" ("Settling Large Tax Disputes") would come out in the beginning of June.

Well, here we are on 14 June (midway into the month) and the NAO have published their report.

The report into five major tax settlements by HMRC, including deals with Goldman Sachs and Vodafone, concludes that the final payments were “reasonable and the overall outcome for the exchequer was good”.

However, the report criticises HMRC for:

-failing to follow strict official processes,
-for refusing to consult its own lawyers before agreeing to drop litigation, and
-for weak internal communications that bred a climate of suspicion within the department.

The latter point is most certainly true, as it chimes with the regular comments/feedback from HMRC staff on this site and their emails to me; it is good that the NAO have picked this issue up and drawn attention to it. However, as to whether there will be an improvement within HMRC remains to be seen.

HMRC are quoted by the Telegraph:
We welcome today’s report. 

We have always maintained that the settlements represented good value for the UK.
The phrase "welcome today's report" rather makes me smile and brings back memories of when I ran an internal audit department, for whenever anyone used that phrase to me they invariably meant that they were really pissed off that their shortcomings had been brought to the attention of others.

Notwithstanding the NAO report and vindication of Dave Hartnett, UK Uncut have been granted their day in court to challenge HMRC's decision on Goldmans. This decision will be subjected to a judicial review, where HMRC said it “will strongly contest” UK Uncut’s application to quash the settlement.

Whatever the outcome of that review Margaret Hodge, chairman of the Public Accounts Committee, has also flagged the issue of processes being bypassed and internal communications failures:
"This report confirms my committee’s concerns about the uncontrolled way that HMRC has been doing secret deals with large companies. If the final settlements in these cases were reasonable, as Judge Park has concluded, questions still remain over why officials bypassed the proper processes.

With billions of pounds of tax at stake it is extremely worrying that the department failed to involve its own specialists in the final negotiations and follow its own rules by settling for less than it could have won in litigation."

Here is the summary of the report
"On the basis of Sir Andrew Park’s reports, I conclude that the settlements reached by HMRC in these five cases were all reasonable. Moreover, in settling them, the Department successfully resolved multiple, long-outstanding tax issues.

However, our concerns over the processes by which the settlements were reached have been confirmed. It was not appropriate to set up governance arrangements specific to certain cases or to fail to apply processes correctly. Poor communication with staff also undermined confidence in the settlements."
Amyas Morse, head of the National Audit Office, 14 June 2012

The National Audit Office has concluded, on the basis of an examination by former High Court tax judge Sir Andrew Park of five large tax settlements, that all five settlements were reasonable and the overall outcome for the Exchequer was good. However, the spending watchdog has expressed concerns about the processes by which the settlements were reached and over poor internal communication of the reasons for settlement.

The NAO review of the settlements followed serious concern by the Public Accounts Committee about how HM Revenue & Customs had handled them or overlooked governance arrangements. The NAO also examined the basis of concerns expressed by whistleblowers.

According to today’s report, all five settlements were reasonable for the Department to have reached under the circumstances and at least one may have been better than reasonable. These large settlements are complex and there is no clear answer to what represents the ‘right’ tax liability. In each case, there was a range of justifiable positions the Department might have taken. The NAO’s examination included consideration of whether the settlement in each case was as good as or better than the outcome that might be expected from litigation, taking into account the risks, cost, uncertainties and timescale of the latter option.

Specialist staff were sometimes excluded from the final settlement negotiations and the Department did not always ensure that these staff involved understood the reasons for settlement. Poor internal communication of the reasons resulted in a loss of confidence in the settlements, both internally and externally.

It is not clear that all settlements were fully compatible with the Department’s Litigation and Settlement Strategy. For instance, there are some disputes where the only possible outcomes are either that the taxpayer owes nothing or that it owes the full amount. In these circumstances, the Department’s Litigation and Settlement Strategy does not permit ‘splitting the difference’. In one settlement, the Department settled for less than if it had won in litigation.  This was reasonable, given the costs and uncertainties of litigation, but was not clearly compatible with the Strategy.

In most cases, there was no need to seek legal advice before agreeing settlement terms. In one case, the Department did not consult its lawyers when it should have done because there was ongoing litigation.

The findings of today’s report confirm the NAO’s concerns regarding the governance arrangements operating in these cases. The Department has acknowledged that its governance processes need strengthening and is introducing new arrangements, including the appointment of an assurance Commissioner, who will approve all large settlements.
As ever, comments and opinions from loyal readers are very welcome.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Wednesday 13 June 2012

HMRC Staff Off Payroll



My thanks to a loyal reader who pointed me to this press release from Kinsella Tax about the 2,400 civil servants who are avoiding tax by using an "off payroll" arrangement.

The full press release can be accessed via this link. However, one particular paragraph relating to HMRC has caught my eye. It appears that some of HMRC's own staff are using this arrangement:
"HM Revenue and Customs (HMRC) announced that nine staff has been paid ‘off-payroll’ and that since the discovery by Exaro News three of these positions have ended. 350 contracts that have paid civil servants ‘off-payroll’ have also ended; 35 civil servants have continued working under new terms and conditions."
Tut tush!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Tuesday 12 June 2012

How Long Does It Take HMRC To Answer The Phone? Poll

This poll is now closed, and here are the results:

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Hanging On The Telephone - Four Million Hang Up On HMRC



As loyal readers are only too well aware, the thorny issue of getting through to HMRC on the phone regularly rears its ugly head on this site with the depressing frequency and inevitability of an unloved season.

Indeed only yesterday I received this Facebook message from a loyal reader:
"Rang HMRC yesterday from 11.00am until 4.30pm and just got the intro/push button crap followed by the engaged tone. Finally got the ringing tone and left it ringing for 35 mins. I hate to think how much it's cost me.
I tried to talk to someone because they say I owe £941 from last year but last year my income was £7200 and my tax code was 747 so I owe them nothing!
In the last 6 weeks I have had 6 tax codings and a total of 11 codes mentioned in those codings, I am so baffled by it all. I e-mailed David Gauke today and am now waiting to see if he can help!
Keep up the good work you are doing a great job!!"
In April 2012 I wrote the following:
"On Tuesday 10 April 2012, LITRG made three calls to HMRC helplines using the routes taken by an ordinary PAYE caller, a pensioner and a tax credit claimant. On average the wait was 29 minutes. LITRG note that on a PAYG mobile that could have cost £11.60 per call, which could equate to half a day’s income for a pensioner (my advice here is that you should avoid calling HMRC using a PAYG mobile)."
It should therefore come as no surprise to anyone that the issue continues to be making headlines, and that the mainstream media have done some probing

The Telegraph reports that figures, obtained by the Times under the Freedom of Information Act, showed that 28% of callers to HMRC (approximately 4 million people) gave up midway through their call to the PAYE helpline. This is an increase from 10% in 2009, when the average waiting time was one minute 53 seconds. Last year, the average waiting time was five minutes 45 seconds.

Fewer than half of taxpayers got through to HMRC on the first attempt, against an industry benchmark of 90%. Labour has accused HMRC of  "chaos and incompetence".

HMRC claim that change in waiting times is because of a decision to increase the size of the queue, so that fewer people hear the engaged tone when they call.

HMRC are quoted in the Mail:
"These figures do not reflect the improvement in service at contact centres."
Fair enough, maybe, my question is has there been an improvement in service at "contact" centres?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Monday 11 June 2012

Information Commissioner Investigates HMRC



The information commissioner has launched an inquiry into the way that HMRC's criminal investigations unit obtained and used personal information belonging to the family of Osita Mba, a revenue solicitor, and his wife, Claudia.

Documents sent to the information commissioner's office show that in October last year one of Mr Mba's managers forwarded his and his wife's address and four contact telephone numbers to an officer in HMRC's criminal investigations unit.

In December 2011 I wrote:
"Osita Mba, a solicitor with HMRC who turned whistleblower on HMRC's deal with the giant vampire squid (Goldman Sachs), is facing disciplinary proceedings (possibly dismissal and prosecution) for telling the National Audit Office (NAO) and two parliamentary committees about his concerns over the deal.
Mr Mba has worked for HMRC for four years, and apparently has knowledge of the vampire squid deal.
 
Mr Mba made the disclosure to the NAO and parliament under whistleblowing legislation which, theoretically, is meant to protect whistleblowers from prosecution etc.

It seems that HMRC think otherwise, and have launched an inquiry into Mr Mba's conduct. He has been barred from entering his office at Westminster unless he has a personal escort from his line manager, and has been summoned to a meeting."
HMRC's criminal investigations unit can examine tax and telephone records as part of its inquiries. It can also apply to intercept post, emails and telephone calls.

The Guardian reports that the information commissioner's office has given HMRC 28 days to explain how its criminal investigations unit obtained the numbers and why it is not in breach of the Data Protection Act.

It will be interesting to read their explanation.

I have warned many times on this site before about the dangers of giving more power to HMRC, this issue highlights why my warning should be heeded.

I am not alone in being concerned, the disclosure has caused concern among MPs on the Commons public accounts committee who say an ongoing criminal inquiry into Mba and his wife is heavy-handed and wrong.

Why are HMRC out to get Mr Mba?

It seems that HMRC blames Mr Mba for the demise of Dave "Jack" Hartnett.

Stephen Barclay, a committee member, said:
"This is a concerning development. We have taken a very close interest in a whistleblower who we regard as having provided information of public interest to parliament. Clearly we will need to see the details but there is a sense of mistakes being compounded with further mistakes."
HMRC have for the moment declined to comment.

However, they cannot remain silent forever and have to answer the information commissioner's questions.

Stephen Barclay advises me that there are two PAC sessions on HMRC on 26/27th of this month. It will be interesting to see what is unearthed.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Friday 8 June 2012

HMRC Guidance For Selling Olympic Torches




Given that the forthcoming Olympics are about making money, rather than sport, HMRC has very wisely issued some guidance to those people who are thinking of selling their Olympic torches.
"

Selling your Olympic Torch

If I sell my torch will I be charged tax?

If the torch is worth less than £6,000 when you sell it then you will not have to pay Capital Gains Tax (CGT) on your proceeds. If it is worth more than £6,000 then you will have a chargeable gain, and you may have to pay CGT, depending on whether you have other gains in the tax year. If you have to pay CGT, the rate charged will be either 18 per cent or 28 per cent, depending on your total income for the year.

You should bear in mind the possibility that selling your torch might be, or might be part of, a trade, in which case any profit would be charged to Income Tax rather than CGT. People who occasionally sell a few personal possessions to raise some cash are not trading, but the things they sell may still give rise to taxable gains as explained above. However if someone regularly sells goods or services, they are likely to be trading and will be liable to Income Tax on their trading profits.

Find out more about what is liable to Capital Gains Tax and how to calculate any liability

If I sell my torch and give the proceeds to charity through Gift Aid what is my tax position?

Depending on the amount received, you may incur a CGT charge. There is no exemption from CGT even if you donate the money you receive on selling the torch to charity.

If you decide to donate the sale proceeds, or the net sale proceeds after CGT, to a charity you will be able to make the donation of money under Gift Aid. For every £100 you donate the charity will reclaim £25 from HM Revenue & Customs (HMRC). In order for the donation to be valid under Gift Aid you will need to pay enough Income Tax or CGT in the tax year to cover the amount of tax the charity will reclaim on your gift.

What if I donate my torch to a charity rather than sell it myself?

If you give the torch to a charity for them to keep or sell themselves there will be no charge to CGT."

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

What is TAXWISE?

TAXWISE is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Taxwise



Tax Investigation for Dummies, by Nick Morgan, provides a good and easy to read guide for anyone caught up in an HMRC tax investigation. A must read for any Self Assessment taxpayer.

Click the link to read about: Tax Investigation for Dummies

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"